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Microsoft Pri0

Welcome to Microsoft Pri0: That's Microspeak for top priority, and that's the news and observations you'll find here from Seattle Times technology reporter Matt Day.

January 11, 2008 at 9:37 AM

Raikes departure: The reactions

The announcement of Microsoft Business Division President Jeff Raikes’ retirement Thursday caught the attention of the usual suspects. Here’s my story on his departure and a short profile of his replacement, Stephen Elop, formerly chief operating officer of Jupiter Networks.

Like me, Mini-Microsoft wondered why, after CEO Steve Ballmer and Raikes praised the deep bench of business leaders at the company — many of whom were groomed under Raikes himself — the company looked outside of Redmond for his replacement. “I tell you, if I was a Raikes direct [report], I would seriously be considering whether I was ready for a new challenge, at Microsoft or elsewhere,” Mini wrote.

I asked Raikes why Microsoft chose an outsider. His answer, and more reactions, are after the jump.

Raikes, in a phone interview Thursday afternoon, said:

“The key thing is, you know, we’re always growing, and so everyone on my leadership team has great responsibility, and they are growing there, and Stephen Elop adds an additional level of skill and experience that I think really helps to complement what my team is doing. Part of the way in which you set the company up for continued growth is you add additional leadership. Sometimes that’s by growing it internally and sometimes that’s by acquiring it externally. That’s always been our strategy, and Stephen Elop, is just a great opportunity for us to add to our overall strength of leadership.”

MSFTextrememakeover, like many observers, was caught by surprise by this announcement:

“My initial reaction — ‘Wow!’ Didn’t see this one coming. Gates, Ballmer, and Raikes have effectively been the top echelon of the company for as long as I can remember. With Gates having already announced his retirement this year, and now Raikes as well, that leaves just Ballmer from the original troika.”

Elop “seems to have the right pedigree,” the blog continues. The transition period — about eight months by the time Elop arrives in Redmond — is “fairly decent.” “But Raikes did a solid job with Office and was widely seen as the leading candidate to succeed Ballmer. So combine that with some other recent high level departures, and I don’t think the market is going to respond positively to the news tomorrow.”

In fact, Microsoft shares are down about a percent at mid-session, but the broader indexes are also in the red, so it’s tough to tell how much of Microsoft’s decline is a reaction to Raikes.

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